(Screenshot of Indio interface.)
Indio (San Francisco), a commercial insurance platform for brokers, announced today that it has secured $2 million in seed financing. Venture capital firms NEA, Compound, Merus Capital and 500 Startups participated in the round, along with insurance carrier Hiscox, according to an Indio statement. Indio says it will use the seed round to grow its user base and platform.
The statement characterizes Indios a workflow management platform that brings traditional commercial insurance brokers into the digital age. Indio’s platform automates the manual processes of retrieving quotes from different carriers and processing insurance applications from clients. According to the statement Indio meaningfully reduces the operational overhead required to run a traditional insurance agency, allowing brokers to focus more on sales and relationship management. Currently, over 96 percent of commercial insurance is sold through traditional brokers. Indio’s stated goal is to power every single commercial insurance transaction that goes through this channel.
Indio was founded by financial services and technology veterans Paul Butler, Michael Furlong and Matthew Watson. Butler was one of the founding engineers at Marin Software; Furlong was a founder of Sliced Investing (Y Combinator, Khosla Ventures); and Watson was a trader at Citigroup.
Reaffirming the Role of the Broker
“We’ve seen a lot of startups approaching the space trying to replace the broker,” comments Furlong, “We feel that the broker is a necessary part of the commercial insurance buying process. Indio takes a contrarian approach, empowering brokers with technology that streamlines their workflow.”
The Indio statement says that brokers who utilize the Indio platform will gain access to a connected commercial insurance marketplace, centralized quoting and digital tools to interact with end clients seamlessly.
“Some brokers spend almost 85 percent of their top-line revenue on SG&A,” comments Watson. “Much of this cost is operational in nature and relates to moving application data from the client to the carriers. We help brokers reduce this cost substantially.”
The Indio founders report that their approach of empowering traditional brokers has also resonated with industry leading insurer, Hiscox, which has made a strategic investment in the platform.
Kevin Kerridge, head of Hiscox’s Direct & Partnership Division opines that brokers are here to stay. “They will just look a bit different, and be more digitally enabled. Indio has the opportunity to power this change,” he comments.
The Indio statement stresses that working with insurers will be an important focus. “The sophistication of insurance companies varies dramatically—some are already launching public APIs while others operate largely in spreadsheets,” comments Paul Butler, who has broad expertise integrating with the legacy technology of utilities, energy companies and search engines.
Centralized Operating System
Indio is following an approach already undertaken by innovators working in other industries, particularly those that have layers of intermediary distribution channels, affirms Rick Yang, Partner, NEA. “Indio aims to be the centralized operating system for the commercial insurance transaction, similar to what Sabre did for travel agencies, or what Schwab did for wealth managers,” he says.
Industries with products distributed through high-level knowledge workers have been well suited to technological enablement as opposed to disintermediation, according to Josh Nussbaum of Compound. “It is our belief that in industries lacking commoditization like commercial insurance, the broker will remain an integral part of the buying process,” he comments. “Indio’s workflow automation platform allows brokers to focus exclusively on being high quality advisors and less on operations.”